We bought a wood!

At Atom bank, we’re not just changing the way people bank — we’re also committed to changing the way banks impact the planet. Today, we’re excited to announce a significant investment in our journey to becoming climate positive by 2035.

We’ve bought 25 acres of newly planted broadleaf woodland in Northumberland, which will sequester nearly 7,000 tonnes of CO2 as it matures. This will be equivalent to the amount of carbon we have produced from our operations since we were founded in 2014.

This investment is a key part of our commitment to reducing our carbon footprint and investing in natural capital projects, with the aim of becoming climate positive by 2035. Our pledge includes our operational emissions and any emissions associated with our lending, making Atom the first and only UK bank to commit to this target.

A growing legacy: our woodland

Our 25 acres of broadleaf woodland sits on the site of an old open-cast coal mine, just inland from scenic Druridge Bay in Northumberland. This puts the wood around one hour’s drive from our headquarters in Durham, so we’re also helping to promote and conserve the spectacular greenery of our own region. The woodland was planted approximately 18 months ago, and is made up of species including willow, sycamore, birch, alder and rowan. Obviously, the trees are very young and just emerging from their protective tubing that give them some protection from the elements and the critters that happily munch their way through young trees.

How does it fit into our strategy?

We’ve committed to being climate positive by 2035 — the most ambitious promise of any of the UK’s mortgage banks — and this includes the carbon that comes from our lending activities. This demands that we reduce the carbon intensity of our lending and to invest in natural capital projects, purchasing or lending on an additional 100 hectares of land this financial year and more in the future.

We’ve only just begun to measure the emissions from our lending, but we know all about our operational emissions (heat, power, travel, IT kit etc). We’ve measured these emissions meticulously and, year by year, have taken action to reduce them to around 600 tonnes per year. However, it is not yet zero, so we start our journey here by directly owning this woodland. And, through direct ownership, we also take on responsibility for tree growth and year to year management of the woodland, rather than purchasing remotely delivered credits. We believe this is an innovative approach for banks to contribute to a more sustainable future, and we’re excited to be leading the way.

What about the wider picture?

To stimulate economic growth, the UK Government is planning to undertake a rapid housebuilding project and changes to the current planning regime. As a lender that supports homeowners and growing businesses, we’re right behind these plans.

Alongside these initiatives, the Government has adopted an approach to mitigate some of the environmental impacts of new development called biodiversity net gain. This approach requires habitats to be created that deliver at least 10% biodiversity gain than the development is responsible for destroying — whether onsite or in another location.

This is now baked into law and into the planning process. It is a new market that will need to mature quickly to ensure the houses and the commercial space that we need are built. This is critical to the future success of the UK and the wellbeing of the many families looking for housing, as well as to Atom as a mortgage lender. Alongside carbon credits, we are also exploring how we can fund projects that generate biodiversity net gain credits, so we will be able to support housing development and mitigate the impact this has on the environment.

What did our key people have to say?

Mark Mullen, chief executive of Atom bank, said:

“We’ve made this significant investment in an area local to Atom because we recognise the responsibility we have to our planet. We could have invested this money in employing more people or launching new products — as to be fair we usually do — but this time we chose trees. In time these trees should store more CO2 than our company has been responsible for emitting in all the years since we were founded.

“We know our customers usually choose Atom because we offer excellent value for money and first-class customer service. But we also want our customers to know their bank is trying to do the right thing. The planet doesn’t care about us, it will keep spinning with or without us populating it, but we all rely on its health for our future existence. So we need to make smarter choices about the companies we deal with, and that includes banks.

“This is an important step as we target becoming climate positive by 2035, which means we will take more carbon out of the atmosphere through our lending and investment choices than we are responsible for emitting. We could have gotten away with promising less, but companies really must do more.”

Ed Twiddy, Director of ESG at Atom bank, said:

“Atom is a business designed for the future, changing banking for the better. We want to and can do more to actively reduce and then reverse our impact on the environment, especially as we grow as a business. This is a challenge but we believe that the efficiency of our operating model combined with a drive to innovate in everything that we do means that we can demonstrate real leadership for the sector.

“As a lender, we’re responsible not only for the carbon coming from our day to day operations and travel but also for a proportion of the emissions from the homes and businesses that we finance. This creates a really significant challenge for us and all other banks — but the same leverage and lending on our balance sheets that funds our profitability and drives these emissions is also part of the answer to how we reverse the emissions whilst retaining the commercial success of the bank.

“Directly owning this woodland and putting our balance sheet to work in a different way is one example of how the power of the banking model, combined with a value set that prioritises doing the right thing, can be turned in favour of both the planet and a profitable future for Atom ”

Measuring and reporting our progress

As a member of Bankers for Net Zero, we’re committed to tracking our progress towards becoming climate positive.

Over the last financial year, our total carbon impact was 658.44 tCO2e, a reduction of 2.2% from the year before. We accomplished this during a period when we increased our operating profit by 600% on the previous year.

We’ve started to measure financed emissions associated with our lending and will disclose these for the first time in our upcoming annual carbon report — so be sure to watch this space for further updates.